(November 9 – 13:10 ET) –
The Nova Scotia District Council of
the Investment Dealers Association
of Canada has imposed discipline
penalties on David James Oulton, a
former registered representative
at Beacon Securities Limited.
On two occasions, Oulton was
found to have exercised his
discretion as to the price and
timing of purchases of shares in a
client account that was not a
“discretionary account”. The
purchases violated Regulation
1300.4 of the Association. The
share price soon dropped
drastically.
The client then presented Oulton
an unsigned letter, drafted to be
from Oulton to the client. The
letter stated that Oulton had made
the above-noted discretionary
trades, that Oulton accepted
responsibility for the losses,
and that Oulton would re-pay to
the client the monies lost.
At the client’s request, Oulton
signed the letter. Beacon
Securities was not aware of the
client complaint, nor that Oulton
had signed the letter. Oulton’s
signing of the letter constituted
conduct unbecoming a RR, contrary
to By-law 29.1, because it was an
unauthorized acknowledgement of
responsibility for trading losses,
and an improper promise to repay
such losses.
The discipline penalties
assessed against Mr. Oulton are a
fine of $10,000.00, and
disgorgement of $100, the
approximate commission income
earned on the discretionary trades.
In addition, Mr. Oulton must pay
$2,000.00 toward the Association’s
costs in the matter.
The District Council also
prohibited his future approval
unless he re-writes the exam
based on the Conduct and Practices
Handbook.
If, Mr. Oulton is re-approved
by the Association for employment
with a Member, the District Council
has ordered that he must be subject
to strict supervision for a period
of six months.
-IE Staff
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